Is the benefit system to generous?

[Guest pelmetman]

I pose this question as I have dicovered that although I am self employed I now qualify for tax credits :-D

Why, well I have started a new business and to fund it I have diverted my drawings from my pelmet business to set it up and run it, this now means that our household income is below the tax credit threshold and we now qualify.

We could of got by quite easy without it and are well used to the feast and famine of reccessions.............................................It pays the wine bill (lol)

[CliveH]

OK - so this is from the Daily Mail, a paper more rabid than most on the topic, but the info is of interest to this aspect of the "How our tax £'s are spent" debate.

……………………………..

 

"Benefits bill overpayments hit £3.1 BILLION in a year - and a third of that was down to bungling officials"

 

http://www.dailymail.co.uk/news/article-1287315/Benefits-overpayments-hit-3-1-BILLION-year.html?ito=feeds-newsxml

 

 

"More than £3billion was overpaid in benefits last year - amounting to almost £100 every second - it emerged yesterday.

 

Mistakes by bungling officials accounted for £1.1billion of the mistakes - the highest margin of error for a decade.

 

Department of Work and Pensions (DWP) officials were responsible for just over a third of overpayment blunders while fraud and customer error accounted for the rest.

 

The DWP annual report revealed errors by officials were responsible for a staggering 35per cent of overpayments in 2009/10."

 

........................

 

For a more specific insight:-

 

http://www.bromsgroveadvertiser.co.uk/news/8225144.Bromsgrove_woman_pleads_guilty_to_benefit_fraud/

 

Good that the issue is being tackled.

 

........................

 

And for an interesting one - where it seems that yet again over zealous officials - even where I would feel the motivation is correct to take on benefit fraud - seem to think that they are above the law.

 

What I find interesting here is that Council Officials seem to have the power to issue a formal caution?

 

And if you object - your only recourse is to be taken to court?

 

In this case the individual was found to be entirely innocent of benefit fraud - but the council took her to court because she would not accept an "Official Caution" for a mistake that it looks like they made!

 

http://www.suffolkfreepress.co.uk/news/Fraud-case-a-waste-of.6368610.jp

 

 

Whatever the rights and wrongs in this case - the tax payer footed the bill for the court case.

 

[W3526602]

Hi,

 

An acquaintance told me about an interview he had just chaired.

 

The "victims" lived in a council house, and were likely to be evicted because they were behind with their rent.

 

Actually, they had been paying the required rent regularly, and on time. The problem was that the council had made a mistake in the ammount of rent they were asking for, and were now demanding that the tenants make up the shortfall ..... immediately.

 

Sorry, I don't know the outcome.

 

602

[GJH]

pelmetman - 2010-06-17 4:57 PM

 

I pose this question as I have dicovered that although I am self employed I now qualify for tax credits :-D

Why, well I have started a new business and to fund it I have diverted my drawings from my pelmet business to set it up and run it, this now means that our household income is below the tax credit threshold and we now qualify.

We could of got by quite easy without it and are well used to the feast and famine of reccessions.............................................It pays the wine bill (lol)

 

There may be an argument which says that a system such as tax credits provdes an incentive for people to set up small businesses and is, therefore, beneficial to the country in the long run but I freely admit that I don't know.

 

What I find shocking about the system is the apparent element of compelling people to claim a benefit whether they need it or not. Perhaps one of the reforms needed is a return to the culture of civic responsibility which says "I don't really need this benefit so I won't further burden the taxpayer by claiming it". :-)

 

Graham

[LordThornber]

GJH

 

What I find shocking about the system is the apparent element of compelling people to claim a benefit whether they need it or not. Perhaps one of the reforms needed is a return to the culture of civic responsibility which says "I don't really need this benefit so I won't further burden the taxpayer by claiming it". :-)

 

Graham

 

Graham, can you please let me know when I can stop holding my breath whilst waiting for your reform? :D

 

Martyn

[CliveH]

 

Hi 602

 

Seems rather similar to the case from Suffolk I posted about earlier.

 

At the risk of boring everyone stupid over my experience with the FSA - I see some similarities to what you quote re the Local council trying to recoup money from the tenants who had done no wrong to a case that involved Friends Provident (FP). Bit of topic - but as the two threads are sort of linked - I hope it makes sense to place this here.

 

Some years ago FP accepted the pension schemes from companies that ceased trading and under the then rules, if the company ceased trading, then the Pension scheme had to be secured and "ring-fenced" within a new scheme or schemes to protect the members.

 

Most appropriate scheme for some was a thing called a Section 32 Buy Out, where the benefits mirrored exactly those of the original scheme. Now whereas the original scheme had trustees overseeing it, a Section 32

did not.

 

But the FSA in its wisdom, not understanding this when it came into power, asked for details of the trustees for all these transferred in schemes from companies that no longer existed!

 

Friends Provident had no record of past trustees as that was never a legal requirement and a S32 has no specific Trustee anyway.

 

Despite the whole industry declaring the requirement from the FSA to be "insane" (Not just Friends Provident were affected) the FSA went ahead and fined many Life Offices on the basis that "You should have appreciated and anticipated that we may have wanted this information"

 

So the FSA fined Friends Provident £300,000.

 

Now FP at the time was a mutual life office

 

So all that the FSA did was to take £300,000 away from FP so it had £300,000 less to distribute to its policyholders than it did before the FSA rewrote the rule book and then applied those rules retrospectively.

 

THUS THE ONLY PEOPLE TO SUFFER FROM THE FSA'S ACTIONS HERE WERE THE CONSUMERS WHO HAD SAVINGS WITH A GOOD SOLID LIFE OFFICE WHO HAD NOT DONE ANYTHING WRONG IN THE FIRST PLACE!

 

THOSE SAME CONSUMERS ARE THE VERY PEOPLE THE FSA WAS ACTUALLY SET UP TO PROTECT!!

 

Thank God its time is coming to an end.

 

 

[GJH]

LordThornber - 2010-06-18 9:49 AM

 

GJH

 

What I find shocking about the system is the apparent element of compelling people to claim a benefit whether they need it or not. Perhaps one of the reforms needed is a return to the culture of civic responsibility which says "I don't really need this benefit so I won't further burden the taxpayer by claiming it". :-)

 

Graham

 

Graham, can you please let me know when I can stop holding my breath whilst waiting for your reform? :D

 

Martyn

What reform is that then Martyn? I'm just growing old disgracefully :D

 

Graham

(Rebel without a clue)

[W3526602]

Hi,

 

Is the system too generous? Dunno! But it does seem unfair. How can it be right for somebody to go to work to pay taxes which are given to somebody who doesn't work ...... and the lazy *** receives more in benefit than the workers?

 

Er ...... if you are not a lazy ***, then I'm not refering to you. I acknowledge that some people are unable to work, and therefore need support.

 

For example .... my son finished Uni (at his own expense) and got a job at £15,000 OTE. In the event, he earned £50,000. He chucked that job, and went to the Sydney Olympics, followed by a year back-packing round Oz .... in a 4 litre estate car, followed by a few months living on the beach in Thailand. Eventually he returned home.

 

The man in the local Job Centre threw a wobbly when my son demanded a job at a similar pay scale, demanded evidence. I don't know how that system works/worked, but my son was able to draw benefit before deciding to return to Uni. But thats another unbelievable story. 8-)

 

602

[Guest pelmetman]

W3526602 - 2010-06-19 7:13 AM

 

 

Er ...... if you are not a lazy ***, then I'm not refering to you. I acknowledge that some people are unable to work, and therefore need support.

 

 

 

602

 

Having semi retired 6 years ago at 46 then I am probably lazy (lol) (lol)

I prefer to call it a lifestyle choice, as we don't have any kids to support through uni as most people our age do. We decided to enjoy life sooner rather than latter, as you never know when your number is up :-(

 

 

 

[W3526602]

Hi Pelmetman,

 

I too retired early, 45, on medical grounds. I did draw benefits for a short period ..... got called in to DHHSS for a chat. Man looked at my file ....

 

"Who said you are suffering from ******* *******?" Sneering tone in his voice.

 

Looked at my file some more, threw a wobbly.

 

"Dr ******! How did you get to see him? Good God! Do not return to work until Dr ****** says you can!"

 

But I got bored, joined the Enterprise Allowance Scheme.

 

602

[CliveH]

Interesting comments.

 

On reflection I would say that the benefit system is not generous enough in some of the most deserving cases.

 

Elderly spouses caring for their partner who has a severe illness such as Dementia Alzheimer’s is one good example.

 

Other good examples are disabled children and the extraordinary trouble the parents have in getting proper help.

 

Is this because the benefit system is far too generous to those that do not deserve to be in receipt of benefits?

 

I would say yes. But I know one of the issues is the "policing" of benefits. Checking abuse is time consuming and therefore costly. And this cost is born by the State or the tax payer. Which links back to the adjacent thread on how large the State needs to be.

 

I certainly do not want large numbers of state officials checking up on everyone, but at the same time I do not want my tax £ given out to anyone that does not deserve help from the State. And I am passionate about the welfare state and support it.

 

But the truth is that some unscrupulous so and so's will abuse it. My suggestion is that where you think there is abuse - report it.

 

We can all moan about it on here till the cows come home - but unless we want yet more State employed "checkers" (and I certainly don't (lol) ) then I suggest we all need to take a bit more responsibility.

 

[CliveH]

This topic re benefits is in the news a lot of late - obvious I suppose given the budget tomorrow.

 

Very thought provoking interview with John Bird - the founder of "The Big Issue" magazine distributed via homeless people as street vendors - on BBC Breakfast just now. Good idea in my book and a good magazine as well if you have never read it.

 

But what John Bird was saying is that the benefit culture is corrosive in that it traps people in the benefit spiral. He said something along the lines of "kind hearted liberals think that giving people money solves the problem but it doesn’t - it traps them".

 

So then the BBC interviewer said to Bird "So you want the do away with the benefit safety net?"

 

Bird replied quite emphatically - "No! - I want to see the safety net turned into a Trampoline to propel people onto better things"

 

Interesting take on the problem and given that Bird has a fair bit of experience and insight on this - I suggest the focus of benefit payments should turned towards the direction he outlines.

 

 

[W3526602]

Hi,

 

My own experience, albeit from over 20 years ago, and not exactly Benefits .... but sort of.

 

My mother in law fell on a Friday evening, and remained on the floor until Monday lunchtime. This seemed to be the time to get "heavy", and insist that she moved in with us. The house needed some alterations, so we applied for a grant.

 

The grant was aproved, along with a whole list of other work which wasn't connected with her disability. Damp proof course, double glazing, dig up and relay floor, replaster ALL. walls, etc, etc. We even got an upstairs extension to accomadate a new bathroom .... which she couldn't access. She died within a year.

 

My father had a stroke. Hospital said he needed looking after. My father was Yorkdhire's answer to Alf Garnet, a real male chauvinist. My wife said, "No way!" So we found him a room in a local care home ..... at £220 a week. There were 26 residents in that home. 23 got their accomodation for free.

 

My friends mother has recently celebrated her 100th birthday, now lives in the same care home. Rent has risen since 1990, but she is able to pay her way out of income, does not touch her capital.

 

I don't know what all that proves. :-S

 

602

[Guest pelmetman]

I think it proves that the people in charge of the country do not have an ounce of common sense (lol)

My own experience of council grants happened in 1984 when I left the Navy, we bought our first house which was in need of major refurbishment, and we where told when we bought it that it was eligible for a council grant, so we applied and bearing in mind the surveyor had said the electric and gas was dangerous................................................................................... we got a grant for a new back door and a larger loft hatch !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! *-) *-) *-)

[W3526602]

Hi,

 

Back to my neighbour.

 

The house he bought (despite being in receipt of benefits) had oil fired central heating. He complained that this was inadequte to supply three baths in quick succession. His three children, all under ten, had a bath every evening .... somewhat different from when I was a kid.

 

Solution? Somebody, I don't know who, bought him a new gas boiler. Which left the problem of the house not being connected to gas.

 

Solution? His house was connected to the gas mains. I don't know who paid for that, but it wasn't him.

 

602

[CliveH]

Admittedly it was over ten years ago but a Travellers family was placed in what was a Council House and is now HA nearby. The house was renovated using council grants - new boiler, cooker, radiators, fridge etc.

 

Locals complained that the new tenants were trashing it and after a few months inspectors called to find the house a shell. No boiler, no copper pipes anywhere, no radiators and none of the fitments that could be unscrewed.

 

According to local residents - the Travellers came back and saw the "inspectors" and just drove on past and never came back.

 

Meanwhile, we all paid via taxes for the house to be done up again.

 

[Porky]

And where does all this money for grants, tax credits etc etc etc come from? A while ago the government declared that any income below £16,000 was below the poverty level. Where does the government start taking tax? Therefore the government are taxing the poor to give tax credits to people who know how to use the system and those above that level>:-)

Until the income tax threshold is raised there is less incentive to work and more money needs to be found. Seems a nonsense to me*-)

 

Roy Fuller

 

[W3526602]

Hi,

 

Again in my old town.....

 

Bloke ran a business delivering coal. Then he became ill, had to stop work, but got sickness benefit to compensate. He put a manager in, to run the business, and went in once a week to check the books, collect the takings.

 

Sickness benefit is tax free?

 

602

[Guest pelmetman]

W3526602 - 2010-06-22 5:26 AM

 

Hi,

 

Back to my neighbour.

 

The house he bought (despite being in receipt of benefits) had oil fired central heating. He complained that this was inadequte to supply three baths in quick succession. His three children, all under ten, had a bath every evening .... somewhat different from when I was a kid.

 

602

 

I remember as a kid sharing the same water with all my siblings until I poo'd in the bath and then no one would get in with me, so I got used to a luke warm bath :$

Even now we still use the same bath water but er in doors allways uses the bath first just in case (lol) (lol) (lol) (lol) (lol) (lol) (lol) (lol) (lol) (lol)

[Guest pelmetman]

Just thought I would slip this one in under the radar (lol)

 

Why should I subsidise someone who earns more than me to to have kids?

 

[CliveH]

Because when those kids grow up and pay their tax and NIC's they will be paying for our care etc.

 

The system works by we now contributing to the state so that it can look after its elderly and sick that exist at this point in time.

 

Whilst I can see the advantage in an "Insured" system whereby we all have our own "policy" or plan and we pay into it for our lifetime so that we personally get the benefit associated with what we have paid in, the State system works very differently.

 

It is a "money in - money out" system whereby the taxes and NIC we all pay today gets used tomorrow for benefits etc.

 

This is why we have to get a grip on the buggers that do not work because they chose not to but take a great deal from the state that they are not really entitled to.

 

I have no issue at all with the state supporting those that truly need it. There but for the grace of god ......etc!

 

So individuals that do not have children should appreciate that in the future when they are old and grey or sick and in need of the NHS, state help or whatever - it is the tax and NIC that those children then pay in the future that will pay for it.

 

One of the big problems of demographics is that thanks to us baby boomers not having so many kids there is a problem in that when the baby boomer population bubble runs through time there will be a point when we wrinklies will be so numerous compared to the number of people in the UK actually working and paying tax and NIC's that the rates these workers could have to pay to support us will be far higher than current rates.

 

I wonder how those kids when grown up will feel about being heavily taxed to pay for peoples care that are not their parents or family?

 

 

:-S

[pkc]

“”Because when those kids grow up and pay their tax and NIC's they will be paying for our care etc. “

“I wonder how those kids when grown up will feel about being heavily taxed to pay for peoples care that are not their parents or family?”

 

Spot on!

 

I have two sons, both very successful who both pay a great deal of tax, and therefore my pension, a daughter who works long hours as a intensive care nurse.

But my other daughter has a disabled child who requires the kind of care that only the state has the resources and medical expertise to supply, Swings and roundabouts?

No man or family is an island.

 

Regards, PKC.

 

[LordThornber]

pelmetman - 2010-06-22 8:58 PM

 

I remember as a kid sharing the same water with all my siblings until I poo'd in the bath and then no one would get in with me, so I got used to a luke warm bath :$

Even now we still use the same bath water but er in doors allways uses the bath first just in case (lol) (lol) (lol) (lol) (lol) (lol) (lol) (lol) (lol) (lol)

 

Talk about behind closed doors.........

 

Martyn 8-) 8-)

[Guest pelmetman]

So its ok for my taxes to go in child benefit to a multi millionare (?)

[CliveH]

Now look here your Lordship! - I had managed to push that mental picture into a well closed file in my brain then you come along and open it again - just when i am having my lunch.

 

The mental picture has put me right of my sausauge and mustard sandwich.

 

Thanks a lot!

 

 

 

(lol)